Ukraine accuses Russia of sabotaging Europe's gas

Gazprom said on Sunday it was honouring in full its commitments to supply customers in Europe, Russian media reported.

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04 Ocak 2009 Pazar 15:08

Ukraine accused Russia on Sunday of deliberately reducing gas flows to customers in Europe as they face freezing winter temperatures.

Poland, Hungary, Romania, Bulgaria and Turkey have reported drops in supplies after Russian state-controlled gas export monopoly Gazprom cut off Ukraine on New Year's Day in a dispute over prices.

Russia has accused Kiev of causing the disruptions by stealing volumes flowing across its territory, but Ukraine hit back by alleging Moscow was cutting flows by more than half through a key export pipeline.

"Naftogaz considers the actions of Gazprom as threatening the energy security of Ukraine and Europe, which could bring unpredictable consequences for the entire gas transit system of Europe," Ukraine's state energy company said in a statement.

"Naftogaz demands that Gazprom immediately renews the balanced supplies of gas to all transit pipelines supplying Russian gas to European consumers."

Gazprom said on Sunday it was honouring in full its commitments to supply customers in Europe, Russian media reported.

Gas flows to Germany, Europe's biggest economy, were unaffected and countries elsewhere said they had sufficient fuel stockpiled to make up for shortfalls of Russian gas for several days -- though not for weeks.

Turkey notes supply drop

Turkey became the latest country to say it was feeling the impact. A senior energy ministry official said volumes from Russia via Ukraine had fallen 5 percent, though this had not posed any problems.

The European Union, which gets about a fifth of its gas from pipelines that cross Ukraine, has demanded that transit and supply contracts be honoured. EU president the Czech Republic said it would not get involved directly in the row.

The EU has called an emergency meeting of envoys for Monday to discuss the dispute, which has again placed Russia's reputation as a reliable gas supplier under intense scrutiny.

Russia's ties with the West are still fraught after it waged a war with Georgia last August, and the gas row is likely to be viewed in some capitals as fresh evidence that Russia bullies its pro-Western neighbours.

Russia and Ukraine's gas companies traded allegations throughout Saturday, indicating the prospect of a swift resolution to the dispute -- over gas debts and pricing for supplies in 2009 -- could be remote.

With no negotiations in sight, both sides said they would bring cases against the other in the arbitration court in Stockholm.

A similar gas row briefly disrupted supplies to Europe three years ago. That crisis prompted calls for the EU to diversify its energy supplies, but it has struggled to break its reliance on Russian gas. Gazprom forecasts EU dependence will grow.

Leaders silent

Gazprom said on Saturday it was increasing supplies through alternative routes, bypassing Ukraine, but those pipelines do not have the capacity to fully replace Ukrainian routes.

Ukraine, already reeling from an economic crisis, is anxious not to be blamed by the EU for the supply disruptions in case that hurts its long-term ambition of joining the bloc.

Political leaders of Russia and Ukraine, most of them on holiday, have been silent on the issue.

Gazprom, which says the row is purely about business with no political motives, said Kiev was playing political games and was not ready to resume talks.

Naftogaz chief Oleh Dubyna said his officials were ready to go to Moscow at any moment to sign a mutually acceptable deal. But for now at least no such deal is on the table.

Russia said it was prepared to charge Ukraine $250 per 1,000 cubic metres this year before talks collapsed and now wants Kiev to pay $418. Kiev said its highest offer was $235, and it wanted Russia to pay higher transit fees.

European Union customers pay about $500 per 1,000 cubic metres of Russian gas, though that price is set to drop in line with crude oil, which tumbled in 2008. Gas prices traditionally follow oil prices with a time lag of about six months.